STOP ORDERS IN NANOTRADER
The NanoTrader platform offers a vast selection stop orders. Stop orders are orders which launch a market order when the market reaches a specified price level (the activation threshold). Stop orders are often used to protect open positions i.e. to limit the maximum loss. In this context they are also called stop loss orders. Certain types of stop orders can also be used to open positions and experienced traders will use them often for this purpose.
TRAILING STOP ORDER
The trailing stop is a stop order which automatically increases its activation threshold when the market goes up. The threshold trails the market price. If the market price goes down or moves sideways, the threshold will remain at its current level. The trader specifies the distance between his trailing stop and the market price.
In this example you can see the trailing stop staying fixed when the market moves sideways. When the market moves up again, the trailing stop starts trailing again.
Tip: in NanoTrader it is possible to place stop orders based on price level, percentage or volatility. When the trader selects percentage and enters, say, 0,25 his stop will be placed 0,25% below the market price.
BREAK-EVEN STOP ORDER
The break-even stop is a stop order which automatically increases the activation threshold to a pre-determined level. Before reaching the pre-determined level the break-even stop order operates like a trailing stop order. The trader specifies the level at which the stop will no longer rise by determining a price level above his entry price, hence the name break-even stop.
In this example, the stop fixed itself 5 ticks above the trader's entry price (small green line indicated by arrow).
Tip: in NanoTrader the Tactic buttons allow you to convert with one click, say, a fixed stop order into a trailing stop order.
KASEDEV STOP ORDER
The kasedev stop is a stop order which calculates its new activation threshold at the end of every period. The threshold is calculated by using the volatility.
In this example we see the stop going up fast when there is more volatility and slow when there is less volatility.
Tip: in NanoTrader different stop orders can be combined. The platform can manage this live and will always activate the safest stop order.
PARABOLIC STOP ORDER
The parabolic stop is a stop order which places the activation threshold closer and closer to the market price as time elapses. The trader determines the shape of the parabole by setting both the horizontal and the vertical movements.
In this example we see the typical acceleration as time elapses of a parabolic stop.
Tip: for an efficient parabolic stop it is important to precisely set both time and movement.
INDICATOR STOP ORDER
Each technical analysis indicator can be used as a stop. Combinations of indicators can also be used as stops.
In this example a long position was stopped out when the fast moving average crosses the slow moving average downwards. NanoTrader can automate these orders.
Tip: an easy way to generate automatic orders based on your indicators is Tactic orders.
COMBINING STOP ORDERS
It is possible to combine stop orders. NanoTrader will manage the orders by always keeping the safest one active.
This example illustrates the advantage a time stop can have over a trailing stop. Due to the time stop the trader exits at a higher price. Without the time stop the trader would exit at the trailing stop if the market continues to go down. On the other hand the trailing stop protects the position before the 10 period time limit is reached.
Tip: it is advisable to always protect a position with a stop order.
BETRAIL STOP ORDER
The BETrail stop is almost a trading strategy on its own. The trader specifies three price levels for consecutive stop orders. The initial stop, a classic fixed stop, is automatically placed when the position is opened. When the market price moves above the trader's entry price, the stop automatically moves to the entry price or above if so desired. Finally, when the market continues to go up, the stop converts into a trailing stop.
This example illustrates the initial stop (1), the break-even stop at the entry price (2) and, finally, the trailing stop (3).
Tip: this stop can be found in the Express folder.
FIXED STOP ORDER (CLICK STOP)
The fixed stop, called click stop in NanoTrader, is the classic stop order. The trader specifies a price level. When the market reaches the specified price level, a market order is launched.
In this example the market price is 1,37979. When the stop price (1,37590) is reached a market order is launched.
Tip: in NanoTrader it is possible to grab a stop order and drag it to another price level.
LINEAR STOP ORDER
The linear stop is a stop order which automatically increases its activation threshold with a fixed value after every period of time.
In this example the trader specified his stop should increase automatically with 2,5 points every 5 minutes. Some traders prefer the linear stop to the trailing stop because it does not go sideways when the market goes sideways or down.
Tip: NanoTrader can place your protection stops automatically when you open a position.
PERIODS HIGH-LOW STOP ORDER
The periods high low stop is a stop order with an activation threshold based on the lowest (highest) price level over a certain period.
In this example of a long position, the stop automatically places itself on the lowest price level of the last 10 periods.
Tip: this lesser-known stop order often increases the profitability of a trading strategy. It tends to pay to investigate this stop order when you backtest.
TIME STOP ORDER
The time stop order is a time limit. If a postion is not closed before a number of periods determined by the trader elapses, then the position is closed at the market price.
In this example the position is automatically closed after 15 periods have elapsed.
Tip: the time stop is usually combined with another stop in order to protect the position before the time limit is reached.
AVERAGE PRICE STOP ORDER
The average price stop is a stop order which places the activation threshold on the average entry price of a position. By using the Tactic orders button you can place this stop on the average entry price every time you add it to your position.
In this example two positions were opened and the stop is now at the average entry price.
Tip: one-click is sufficient to place this order using the Tactic buttons.
TRENDLINE AND CHANNEL STOP ORDER
A stop order can be placed on a trendline or a trendchannel.
In this example the stop order automatically follows the trendline upwards. Another unique NanoTrader functionality.
Tip: the stop order evolves in steps because it must follows tradeable price levels. E.g. this future trades in ticks of 0,5.
COMBINING STOPS AND INDICATORS
It is possible to combine stop orders and technical indicators.
In this example a trailing stop is combined with a crossing moving average. The position was closed in the candle by the trailing stop.
Tip: all stops and indicators can be combined.
TIMED STOP (FLAT FILTER)
The timed stop, usually called flat filter, closes a position at the market price at a specific point in time. The trader can also set an end time. No new position will be opened before the end time is reached.
This example shows a flat filter which closed a position at 18h00. The flat filter colours the background from the start time (moment when the position is closed) to the end time (moment at which a new position can be opened).
Tip: this stop can be found in the Timed Exits and Filters folder